Ilyas Patel Accountants in Preston
Tax season is here, and with it comes the pressure of meeting the Self-Assessment (SA) deadline.
The stakes are high: missing the January 31st deadline can lead to significant penalties, interest charges, and long-term financial consequences.
Are you ready to face the financial fallout of procrastination, or will you take action to save yourself from unnecessary costs?
(Read Time: Approx. 4 minutes)
Failing to submit your SA tax return or pay your taxes on time can lead to a cascade of penalties.
Here’s what you could face:
Imagine Michael, who went to Finland on a sabbatical in January 2023 and accidentally forgot to file his 2021–22 Self-Assessment tax return.
This resulted in an automatic £100 penalty.
Upon returning, Michael filed his return on 1 February 2024. HMRC imposed the following penalties:
The total penalty was capped at £1,100 due to statutory interaction rules that prevent the penalties from exceeding 100% of the tax due.
If you account for the interest, you’d be looking at a 7% on top of this per day – this would potentially cause Michael to reach the cap sooner.
Now consider Sarah, who owed a £10,000 balancing payment for the 2021–22 tax year, due on 31 January 2023.
She ignored reminders and finally paid her tax in February 2024. Here’s how the penalties accrued:
Sarah incurred £1,500 in late payment penalties, plus daily 7% interest – this results in the charges of:
HMRC recognises reasonable excuses in rare circumstances, such as severe illness or system failures.
Victims of the Post Office Horizon scandal or those affected by specific Covid-19 delays may also receive leniency.
However, these are exceptions, not the rule.
Most taxpayers must adhere to strict deadlines or face the consequences.
If you’re struggling to meet the deadline, consider these strategies:
If you owe HMRC money, it’s essential to understand the process they follow to recover debts.
Their Debt Collection process is systematic and escalates if action isn’t taken promptly.
Here are the five stages you need to know:
We work closely with HMRC at every stage of this process, leveraging our direct contacts to secure long-term payment plans that may not be available to you otherwise.
The earlier we step in, the better the chances of achieving a favourable resolution.
The Self-Assessment deadline is fast approaching, and failure to act could leave you facing penalties, interest charges, and the stress of dealing with HMRC enforcement.
Don’t let inaction ruin your financial stability. Start your filing process today to avoid the costly fallout of missed deadlines.
For actionable tips, watch our TikTok video on avoiding SA penalties.
Contact us at Ilyas Patel Accountants for professional guidance.
Fill out our form here for any questions, give us a call at 01772 920579, or message us on our WhatsApp for out of office hours.
Kind regards,
Ilyas Patel